Sell for More Trivia is a weekly blog series that playfully presents a trivia question about commercial real estate.
Multifamily real estate is shifting from an asset class to a business. What was once viewed as a ‘passive’ investment is becoming a sophisticated operation. The one-sized-fits-all model of the past is dead.
Knowledge workers expect flexibility. They’re not tethered to a single geographic location. They expect to access everything seamlessly through technology. And they expect great customer service. The game has changed.
The multifamily industry used to be dominated by traditional real estate companies. Today, many new players have emerged.
Now that many folks will soon be able to work and live anywhere, housing must become more flexible to meet this shift.
Here are a few of the platforms catering to this new type of renter. (Note: most of them don’t own any physical real estate)
Landing is a membership-based platform that offers fully furnished apartments throughout major cities in the U.S. For $199/mo., members get access to all locations, the ability to move with a 30-day notice, pay no security deposit, and have 24/7 concierge.
Access to fully furnished units and the ability to move at any time with 30-day notice is unique in the multifamily industry. While regulation varies from state-to-state, owners are often prohibited from signing leases shorter than 6 months without incurring a hotel tax. Meanwhile, month-to-month leases aren’t desirable as residents can leave with a 30-day notice. Landing solves both of these issues.
Landing works with landlords in several ways; they lease units, sign revenue share agreements or they market units on their platform and lease them once a reservation comes in.
Common, known primarily as a co-living company, is quickly evolving into a housing platform. They typically offer furnished rooms and flexible lease terms at affordable rates and on a single bill. They target primarily young professionals and rely highly on their design, online marketing, and branding.
They streamline the leasing process and day-to-day living experience through technology. They also offer cleaning and other basic concierge services.
The lines between leasing an apartment and booking an Airbnb are blurring. Early on in the pandemic, Airbnb CEO Brian Chesky saw the opportunity in “longer-term rentals to city dwellers looking for a protracted retreat.”
Chesky believes the world is currently undergoing “a giant experiment where people are realizing they can work remotely.” A more flexible office and employment market equal a more flexible housing market. And more flexible housing market equals an opportunity for Airbnb.
When searching on Airbnb today, you will find an option for ‘find a monthly stay’.
Ollie is another co-living brand that combines flexible leasing with hotel-style services and a focus on community and amenities. They offer fully furnished units, housekeeping, roommate matching, and community events, all connected through the Ollie Living app.
While Ollie and Common are similar, Ollie is more involved with the development from day 1 and is fully integrated into the project.
Bento Living is a fully furnished project in Nashville which offers the flexibility to ‘stay a few nights’ or ‘live a few months’. The units are thoughtfully-designed and many include space-saving furniture such as murphy beds.
For stays longer than a few days, renters get one bill which includes Wi-Fi, cable TV, cleaning, utilities, linen and towel service, and access to events. When you’re traveling you have the option to put your unit back into the hotel pool to be rented out for short-term stays.
Philadelphia-based Korman Communities pioneered the extended-stay apartment with hotel services. Their brands AVE Living and AKA each offer furnished apartments with flexible lease terms.
AVE targets professionals, looking for a minimum stay of at least 30-days. While they focus on business travelers and corporate relocations, their model may be ripe for the new class of remote working professionals.
AKA is a bit trendier and caters to weekly and monthly stays (minimum of 1 week) while offering hotel-style amenities and services.
The multifamily industry must respond to evolving preferences. Doing the same thing everyone else is doing, but a little better, is becoming an increasingly less viable business model.
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About Beau Beach, MBA CCIM
Beau is a tenacious Commercial Real Estate Broker, author and adoring father of four. His clients appreciate his no-nonsense demeanor and his legendary work ethic.
Beau leads Beachwood which is a commercial real estate broker for sellers in the Nashville, Milwaukee and South Florida markets.
He’s the author of the books The 3 Reasons: Why Most Commercial Properties Don’t Sell and True Wealth: What Every Seller Should Know About 1031 Exchanges.
Beau can be reached at 800-721-3287, click to schedule a call or Beau@BeachwoodSells.com